The research analyzes the growth and evolution of the Asia Pacific renewable energy market up to 2009 and gives historical and forecast statistics for the period 2000-2020. This research also gives a detailed analysis of the market structures of all renewable energy technologies in the region and the regulatory policies that govern them. The research in the study is based on proprietary databases, primary and secondary research, and in house analysis by GBI Research’s team of industry experts
Rapid Economic Growth in Developing Countries is Driving Growth in Asia Pacific Renewable Power Market
The Asia Pacific region is home to the most rapidly developing economies with high economic growth rates. This economic growth has led to a rise in energy demand and consumption and therefore a shortage in many countries. Additionally, since the majority of energy is currently produced through conventional thermal sources it has led to an increase in greenhouse gas (GHG) emissions.
As a result there arises a need to develop renewable resources to ensure energy security and to address rising GHG emissions. Thus the share of renewables in the Asia Pacific energy mix is expected to rise from 4% in 2009 to about 13% in 2020 on the back of supportive government policies and incentives.
Infrastructural Bottlenecks are Restricting the Growth of Renewable Power
Insufficient supportive grid, transmission and distribution infrastructures in many countries might lead to the delay or cancellations of renewable power plant installations. The transmission and distribution of electricity generated from renewable sources might be affected due to low grid capacity and limited access to the national grid in many regions within the Asia Pacific countries.
Thus, the weak transmission and distribution infrastructure has become a restricting factor in the growth potential of renewable energy.
China Overtook the US as the Largest Investor in Renewable Energy in 2009
China has spent $34.6 billion on renewable energy in 2009, whereas the US spent $18.6 billion – about half of what China has invested. Renewable energy investments were mainly allocated to small hydropower projects, solar power projects, and wind energy projects.
This high level of investments in the country has mainly been driven by stable and long term supportive government policies and easy access to credit. The country aims to produce 8% of its total energy consumption from renewable sources and to achieve this goal; the government has planned to invest another $216 billion in the coming five years for renewable energy development, 170% more than as planned by the US ($80 billion).
Japanese Market is Driven by Kyoto Protocol Targets
According to Kyoto Protocol Japan should reduce its GHG emissions by 6% as compared to 1990 levels during 2008 to 2012. Japanese GHG emissions declined in 2008 due to a decline in energy demand as a result of the global economic slowdown.
Japan is promoting the use and generation of renewable energy sources in an attempt to achieve its Kyoto Protocol targets. The government passed a bill in March 2010 that increased their targets to a 25% reduction in emissions by 2020 and 50% by 2050 through the promotion of renewable energy, nuclear power, and carbon taxes.
India is Looking at Renewable Energy to Bridge the Demand Supply Gap
India’s peak power electricity capacity deficit in 2009 was as high as 11.9% while this is expected to widen in 2010 to reach more than 12.5%. This power shortage also encourages electricity thefts which further worsens the condition.
This will pose a need for diversification in the country’s energy generation profile to include other sources such as nuclear, small hydro, solar, wind energy and other renewable sources. This will boost the renewable power industry in India.
Extended Renewable Energy Targets (RET) will drive Australian Renewable Power
RET was first introduced in 2001 with the target of generating 2% of energy from renewable sources. This was revised to 20% of energy from renewable sources in 2007 to reduce the effect of a decline in Renewable Energy Certificates (REC) prices and to enhance the focus on renewable power development.
RET has been further revised and will be effective from January 2011. According to the revised RET; the country will generate 45 TWh of electricity from renewable sources by 2020. These RETs will drive investment in the renewable energy sector in Australia and lead to the growth of the industry in long term.
Geothermal will Lead Growth in Renewable Energy Sector in Indonesia
The government is accelerating the utilization of geothermal resources to promote investment in cleaner energy solutions. The country has set a mandate that geothermal should contribute at least 5% to the nation’s electricity by 2025.
Geothermal energy in Indonesia has also attracted investments from many US companies and international bodies which are expected to grow with policy incentives. The World Bank is providing a $400 million in funding to develop the country’s geothermal energy as part of its $40 billion initiative to develop low-carbon growth projects globally.